China Railway No. 10 Engineering Group Co. Ltd. v. Triorient, LLC

Background

China Railway No. 10 Engineering Group Co. Ltd. is identified in the opinion as a Chinese corporation based in Jinan, China. Triorient, LLC is identified as an American corporation based in Darien, Connecticut. On September 4, 2017, the parties entered a contract for China Railway’s sale and delivery of approximately 30,000 metric tons of HBI for a purchase price of $7,778,265. The contract required disputes to be resolved through mandatory arbitration in New York, New York, and provided that the prevailing party would receive reasonable attorney’s fees and costs.

China Railway shipped the HBI on October 4, 2017. Triorient paid $7,000,000 on October 25, 2017, but did not pay the remaining $778,265. China Railway began arbitration on September 18, 2019. During nearly 14 months of arbitration, Triorient argued that it was entitled to reduce the price because the goods did not conform to the contract specifications.

Arbitration Award and Court Proceedings

On December 11, 2020, the arbitrator issued a 48-page final award. He found that Triorient had not proved that it was entitled to reduce the price and ordered it to pay China Railway $778,265, $74,300 in arbitration costs, and $93,247.80 in legal fees and expenses incurred during the arbitration. The award provided for 9% annual interest on the $778,265 from October 26, 2017, until payment, and 9% annual interest on the arbitration costs and arbitration legal fees and expenses from December 11, 2020, until payment.

China Railway filed a petition to confirm the award on July 15, 2021, under the parties’ contract, the Federal Arbitration Act, and the Convention on Recognition and Enforcement of Foreign Arbitral Awards. Triorient was served but did not appear, respond, or ask the court to vacate, modify, or correct the award.

The court explained that an unanswered petition to confirm an arbitration award is treated as an unopposed motion for summary judgment. Summary judgment is a decision entered when the record shows no material factual dispute requiring a trial. The court reviewed the arbitrator’s decision and the materials submitted by China Railway, and found no material issue of fact that the arbitrator had not already resolved. The court also found the arbitrator’s decision comprehensive, well-reasoned, and supported by documentary and testimonial evidence.

Ruling

The court granted the Petition to Confirm the Arbitration Award. It directed the Clerk of Court to enter judgment for China Railway in the following amounts:

- $778,265 under the contract, plus 9% annual interest calculated from October 26, 2017, until payment; - $74,300 in arbitration costs, plus 9% annual interest calculated from December 11, 2020, until payment; and - $93,247.80 in legal fees and expenses incurred during the arbitration, plus 9% annual interest calculated from December 11, 2020, until payment.

China Railway also requested attorney’s fees and costs incurred in bringing the court confirmation proceeding. The court stated that such an award could be available because Triorient had not complied with the arbitrator’s award. But China Railway had not requested a specific amount or submitted time records or other documentation showing the work performed and costs incurred. The court therefore denied without prejudice the application for fees and costs incurred in the confirmation proceeding. China Railway was permitted to submit a supported application by January 24, 2022, after which the court said it would determine reasonable fees and costs and issue a later ruling.